Value
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 2.9 |
| P/S | 7.5 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 5.4 |
| PEG | 10.0 |
| Analyst target | 9.0 |
- ▸Forward P/E: 23.6x
- ▸PEG: 0.31
ALLT · Why this verdict
Why Allot (ALLT) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score6.1/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Allot pairs excellent cash conversion, a wide moat and a consistent earnings-beat record with a thin 4.0% operating margin and modest insider selling. A 31.2% analyst-target upside makes the setup attractive, but the small, volatile stock is a speculative position.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The growth profile is strong, with quarterly revenue of $27.7M, up from $24.1M a year earlier, and earnings growth scoring a maximum 10.0. Bull case | Revenue growth should stay above 10% year over year across the next four quarters. | →Stable |
| CounterRevenue is still below the $35.3M and $32.8M levels of FY2021 and FY2022, so the recovery may be cyclical, and growth confidence is only 0.67. | ||
Profitability is thin: the operating margin is 4.0%, flagged as margin compression, and it drags the quality components for operating margin to 1.6. Bear case | Operating margin should expand toward 8% or more as the growth in revenue spreads fixed costs. | →Stable |
| CounterGross margin scores a maximum 10.0, so the compression may come from deliberate investment that can reverse. | ||
The business converts earnings to cash very well, with 192% free cash flow to net income, a wide economic moat and a Piotroski F-Score of 9 out of 9. Quality breakdown | Free cash flow should stay above net income and the Piotroski score should remain at 7 or higher over 12 months. | →Stable |
| CounterCash conversion above 100% of a tiny net income can come from working-capital timing and may not persist if profits grow. | ||
Earnings delivery is strong: two beats and no misses in the last four quarters, with the August 2026 quarter beating the estimate by 58.81%. Avg surprise pct | EPS should meet or beat estimates in the next four quarters, keeping the surprise record positive. | ↓Deteriorating |
| CounterThe surprises come off a tiny EPS base of a few cents, and several earlier quarters in the history were large misses. | ||
The $8.94 price is 31.2% below the $11.73 analyst target, a reward-to-risk of 2.87 against 10.9% downside to the stop. Upside pct | Price should move toward the $11.73 target over 12 months while holding above the $8.31 stop level. | →Stable |
| CounterAnalyst coverage is light and implied volatility is 82%, so the stop can be reached long before the target. | ||
The growth profile is strong, with quarterly revenue of $27.7M, up from $24.1M a year earlier, and earnings growth scoring a maximum 10.0.
→StableBull case
- Expectation
- Revenue growth should stay above 10% year over year across the next four quarters.
CounterRevenue is still below the $35.3M and $32.8M levels of FY2021 and FY2022, so the recovery may be cyclical, and growth confidence is only 0.67.
Profitability is thin: the operating margin is 4.0%, flagged as margin compression, and it drags the quality components for operating margin to 1.6.
→StableBear case
- Expectation
- Operating margin should expand toward 8% or more as the growth in revenue spreads fixed costs.
CounterGross margin scores a maximum 10.0, so the compression may come from deliberate investment that can reverse.
The business converts earnings to cash very well, with 192% free cash flow to net income, a wide economic moat and a Piotroski F-Score of 9 out of 9.
→StableQuality breakdown
- Expectation
- Free cash flow should stay above net income and the Piotroski score should remain at 7 or higher over 12 months.
CounterCash conversion above 100% of a tiny net income can come from working-capital timing and may not persist if profits grow.
Earnings delivery is strong: two beats and no misses in the last four quarters, with the August 2026 quarter beating the estimate by 58.81%.
↓DeterioratingAvg surprise pct
- Expectation
- EPS should meet or beat estimates in the next four quarters, keeping the surprise record positive.
CounterThe surprises come off a tiny EPS base of a few cents, and several earlier quarters in the history were large misses.
The $8.94 price is 31.2% below the $11.73 analyst target, a reward-to-risk of 2.87 against 10.9% downside to the stop.
→StableUpside pct
- Expectation
- Price should move toward the $11.73 target over 12 months while holding above the $8.31 stop level.
CounterAnalyst coverage is light and implied volatility is 82%, so the stop can be reached long before the target.
Per-dimension breakdown
Quality
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.1 |
| ROA | 1.7 |
| Gross margin | 10.0 |
| Op margin | 1.6 |
| Net margin | 4.7 |
| Current ratio | 7.8 |
| FCF quality | 10.0 |
| Moat | 7.9 |
| Rule of 40 | 5.5 |
| Piotroski F | 10.0 |
- ▸Excellent cash conversion: 192% FCF/NI
- ▸Wide economic moat
- ▸Strong Piotroski F-Score: 9/9
Growth
8.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.3 |
| EPS growth | 10.0 |
Momentum
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.2 |
| MACD | 6.8 |
| OBV | 10.0 |
| MA position | 7.5 |
| Volume | 0.6 |
- ▸Overbought (RSI 75)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-MA but MA slope flat/negative + RSI 75 (late-cycle distribution risk)
Sentiment
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.3 |
| Price target | 9.4 |
| erm sentiment | 5.0 |
- ▸Light analyst coverage (5.0) — signal dampened
- ▸Analyst upside: 47%
Insider
3.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 5.0 |
- ▸Notable insider selling — $512,161 (0.114% of mkt cap)
Peer rank
5.3/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.5 |
| quality rank | 4.7 |
| growth rank | 4.6 |
Technical
2.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.1 |
| support resistance | 1.3 |
| 52w position | 5.4 |
Risk (lower is worse)
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.8 |
| days to cover | 6.9 |
| volatility | 0.9 |
| put call | 10.0 |
| implied vol | 0.0 |
| max pain risk | 3.0 |
| beta | 5.1 |
| debt equity | 9.8 |
- ▸High IV: 92%
- ▸Above max pain $6
Catalyst
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| news activity | 5.0 |
- ▸Earnings in 13 days
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:5.8>=5.5
- ASYMMETRY:2.2>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (1)
- EARNINGS_PROXIMITY:13d<=14d (soft)
Reward-to-Risk
2.18
Upside
+28.2%
Downside
12.9%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.48>1.3, MCap $0.5B<$5B
Investment implication
The F-path SELL output reflects an overall score of 5.3 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 8.2) was not enough to lift the adjusted overall above the threshold. Current asymmetry R:R is 2.18 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 8.2, Sentiment at 7.4, and Catalyst at 7.0; the weakest are Technical at 2.9, Insider at 3.3, and Peer rank at 5.3. The V9 engine cleared all gates with 1 warning, producing an asymmetric reward-to-risk of 2.18 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Cash Conversion Wide Moat
Trip ifFree cash flow to net income falls below 100% from current 192%.
- P2Consistent Earnings Beats
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P3Thin Operating Margin
Trip ifOperating margin rises above 10% from current 4.0%.
- P4Steady Revenue Growth
Trip ifRevenue growth falls below 5% YoY for 2 consecutive quarters.
- P5Analyst Target Upside
Trip ifPrice falls below the $8.31 stop level from current $8.94.